GST will cost oil companies Rs 25,000 crore

May 23:
The rise in input costs for oil firms due to GST paid on the procurement of plant, machinery and services will not be creditable against the excise duty and value added tax on crude oil, petrol and diesel.8This would imply collective absorption of tax close to Rs 25000 crore by upstream and downstream oil companies, thus, increasing the compliance burden.8Post the implementation of GST from July 1, 2017, all oil firms may have to comply with the old and new tax regime as majority of the products like crude oil, natural gas, petrol, diesel and jet fuel are excluded from GST whereas input cost components will come under GST.Click on Reports for more